Academic versus reality – a tale of 2 studies (Part II)
Nico Neumann, assistant professor and fellow at the Centre for Business Analytics at Melbourne Business School, continues his look at the real impact and measures of advertising effectiveness.
Earlier we looked at the widely criticised Chicago study featured on Freakonomics, which delivered two main messages: Advertising has often been measured inaccurately and about half of CPG brands analysed seem to not achieve a positive ROI for their TV advertising investment.
Another recent study that went viral online was the work titled ‘When brands go dark’, carried out by the Australian Ehrenberg-Bass Institute (EBI). The authors collected a sample of 57 cases from alcoholic-beverage brands that switched off advertising and had declining sales in the years afterwards. This was nicely illustrated in the following graph:
